Martha Stewart shares gain on TV deal

Jailed domestic diva to host daily show on NBC next year

By

JonFriedman

DanBurrows

NEW YORK (CBS.MW) -- Shares of Martha Stewart Living Omnimedia closed by soaring nearly 7 percent on Wednesday as the imprisoned domestic diva's company signed a multiyear deal with famed "Survivor" producer Mark Burnett to host a new television program for NBC.

Martha Stewart Living's stock
MSO, +0.00%
climbed $1.56 to $24.44 on Wednesday as Burnett, Martha Stewart Living Chief Executive Susan Lyne and NBC President Jeff Zucker announced the creation of a daily daytime show featuring Stewart.

Taping for the show will begin in September, with an eye on debuting the program at an as-yet unspecified time late next year. By that time, Stewart will have returned to her home. The show will appear on stations covering more than 30 percent of the U.S.

The program will center on the kinds of lifestyle and cooking themes that enabled Stewart to build a marketing and media empire before she went to prison on an obstruction conviction.

"This is a forgiving country," Lyne said during a 35-minute press conference at Martha Stewart's company headquarters on West 26th Street in New York.

"We took our lead from the feeling of (her fans)," Lyne said.

One of the main themes of the news conference -- in which Lyne, Zucker and Burnett made opening statements before fielding questions -- was that Stewart's legions of supporters had been clamoring for her to come back to television.

The speakers divulged few details about the show's content, other than to note it will be taped live and that Stewart will interact with a studio audience. Burnett said many "very big names" had already called to appear on the show, too, but he didn't identify anyone.

In fact, the speakers insisted that Stewart will be even more famous for having served time in jail. Burnett tried to lighten the mood by joking that Stewart gave him a gift before she went away. It was an object that, he quipped, looked like it could be a file to be put inside of a cake -- a standard joke for someone who is behind bars.

The mood at the press conference turned serious when the speakers tried to stress that Stewart hadn't violated her prison terms by actively participating in the planning and creation of the TV show.

Investors are cheering the prospect of Stewart's return from incarceration because the betting is that her company is worth more money with her back at its helm.

On Tuesday, the New York Post speculated Stewart, 63, could be paid up to $8 million a year for the show. The Post speculated further that Stewart could replace Jane Pauley, whose daytime talk show's ratings haven't lived up to expectations.

Stewart is serving a five-month sentence for obstructing the government's investigation into a stock sale she made for her personal account. She is scheduled to be released in March and is then expected to serve an additional five months of home detention.

A self-made billionaire, Stewart symbolized a rags-to-riches business tale as she built an empire on her skills as a homemaker.

Stewart's trial was covered in exhaustive detail by the media, and her life behind bars remains a topic of much conversation. The likes of CBS late-night host David Letterman make her the butt of numerous jokes.

Predictably, Stewart's company has had a tumultuous time. Stewart's successor in a corporate role, Sharon Patrick, stepped down and was replaced as president and chief executive by Lyne, a former ABC-TV executive.

When Stewart ran into trouble, many advertisers abandoned her company. Her fellow executives have struggled without their guiding light -- and wrestled with how closely the company should be tied to its imprisoned visionary.

Before her legal predicament, Stewart had been starring in a popular syndicated television show, in which she presented recipes and other advice. When her legal troubles mounted, however, the program was taken off CBS stations and later suspended. (CBS is a unit of Viacom, a significant investor in MarketWatch, the publisher of this report.)

So-called reality TV has been the rage in recent years in the United States. Shows ranging from "Survivor" to "Fear Factor" and "The Bachelor" score in TV ratings as contestants try to win big money for engaging in outrageous acts.

"Survivor" made a name for itself and its genre in its initial season. It garnered tremendous publicity when one of its island inhabitants ate a bug as part of the competition to avoid being banished from the show.

The question on Stewart's next show is whether producer Burnett will have her eating insects or serving them.

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